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Save before you brave it

If you plan to quit and strike out on your own, you must have an emergency fund. Estimates vary, but experts say anywhere from three to six months of wages in a savings account or highly liquid, safe investment is a smart starting point.

There are several reasons to do this. First off, even if you have an informational website and/or several gigs in the can, there will be financial bumps along the way. Count on it. Clients won’t pay on time — though your “pay now” bills will arrive without fail. Steady work can go on standby, or get cut without notice.

And did you remember those estimated quarterly tax payments? Forget those, even by a few days, and you’ll incur a penalty and perhaps have to scramble for the needed funds.

About the worst thing you can do is start out by incurring high-interest, unsecured debt. That’s a recipe for financial disaster as high balances will leave you treading water, with minimum payments barely covering interest rates.

What’s more, you’ll need to think long and hard about health insurance, a perk of full-time work. This can be incredibly costly, though packages exist for self-employed individuals like this one from Blue Cross. Take care of yourself before you take the big leap.

Read more: Here's how much the average American 60-year-old holds in retirement savings — how does your nest egg compare?

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Monetize your passion

Want to be your own boss? Awesome. Want to avoid the drudgery of a dull day job? Yes, it can be done. Ideas to create cash flow can easily stem from your latest passion project.

Demand for freelancers is on the rise. Amid recent mass layoffs and hiring freezes, 43% of business owners surveyed by freelancer platform Fiverr in 2022 said they plan to hire freelancers during the current economic downturn and 81% of respondents said they are already using freelancers to support their staff and fill skills gaps.

Freelance writing is one of the most common gigs, and among aspiring writers, the options include starting a subscription newsletter, ghostwriting, or recording an audio book: one area of publishing that’s showing healthy growth. Get this: Audiobook revenue in the United States hit $1.6 billion in 2021, up more than 23% from the previous year. And it is expected to reach $19.7 billion by 2028.

If hustling’s your thing, consider dropshipping, where you purchase items in bulk for a low cost and sell them online through e-commerce sites such as Etsy, Reverb, Shopify or Amazon. Couple this with a social media strategy and you’ve got yourself a business; teach others how to do social media and you’ve got another business.

Some do see riches quickly; stories of TikTok and Twitter influencers abound. For the rest of us, patience is a rock-solid virtue. Take time to find a project that fits the lifestyle you want. (You did quit in part for quality of life reasons, right?) Luckily, there are tons of resources available.

Dare to move beyond one thing

Is striking out on your own risky? No doubt. But so is depending on a 9-to-5 job to provide everlasting security. Stories of those who log 20 or more years at a company are becoming increasingly rare — while news of layoffs, job cuts and the shenanigans of petty bosses are sadly here to stay.

Multiple income streams can create far more security than one job ever could. This explains why more Gen Zs and millennials are seeking opportunities to work less, but make more.

So how do you diversify? Creating passive income sources represents a fantastic portal. If you create a niche podcast, landing three sponsors as opposed to one doesn’t triple the amount of work you do — though it could triple your revenue.

Some choose to re-create a full-time job by cobbling together several part-time gigs they love. Also consider building on your core competencies. If you know basic audio engineering, that puts you one short step from recording interviews live — otherwise known as “tape syncing.” Many outlets will pay you $100 an hour or more to record the interview and deliver it quickly via Dropbox or WeTransfer.

You could also have ready-made income sitting just outside your apartment by renting out a parking spot, or collecting finder’s fees for referring business to a real estate agent or local merchant.

Find your niche, find your pace — and most of all, find the time to make it happen. Who would’ve thought quitting meant getting to work? Well, maybe you did — or anyone smart enough to leave behind dead ends for positive possibilities.

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Amy Legate-Wolfe Freelance contributor

Amy Legate-Wolfe is an experienced personal finance writer and journalist. She has a Bachelor of Arts in History from the University of Toronto, a Freelance Writing Certificate in Journalism from the University of Toronto Schools, and a Master of Arts in Journalism from Western University. Amy has worked for Huffington Post, CTVNews.ca, CBC, Motley Fool Canada, and Financial Post. She is skilled at analyzing trends and creating content for digital and print platforms. In her free time, Amy enjoys reading and watching British dramas on BritBox. She is a mother and dog-mom to a Wheaten Terrier.

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